The housing market is showing significant improvement as home prices in May registered the biggest increase in almost four years.

A report released by real estate valuation company Clear Capital showed that prices of residential real estate jumped 6.8% last month from a year ago. The increase is said to be the highest since July 2006. “We continue to see sustained price growth throughout much of the country with yearly price gains reflecting the housing recovery off last year’s lows. In June of last year, we reported a national yearly decline of 19.3%, whereas the present report shows a 6.8% gain,” said Alex Villacorta, the company’s senior statistician.

The jump in home prices was felt in all four regions of the country, with the Midwest region recording the biggest increase of 4.5%. On the other hand, the number of real estate owned properties, or REOs, in the market fell during the same period. According to Clear Capital, the national REO saturation rate fell from 41.7% to 27.8% year-on-year.

Villacorta attributed the development to the April 30 expiration of the federal tax credit program, which prompted home buyers to rush to sign purchase contracts. And with the huge number of pending home sales, he added that Clear Capital expects real estate prices to go up in the coming months.